China Currency Bill Introduced by Senators Snowe, Brown [FULL TEXT INCLUDED]

A bill that seeks to punish China’s undervalued currency with import tariffs is introduced on Thursday by Senators Olympia Snowe (R-Maine) and Sherrod Brown (D-Ohio).

Titled Currency Reform for Fair Trade Act of 2011, it will give US businesses the ability to petition the Commerce Department to levy duties on Chinese goods that are cheaply sold, to their detriment, in the US market.

Snowe blamed China’s undervalued currency for withering the “once-unparalleled manufacturing base” of the US.

At the center of Snowe and like-minded critics’ complaint is that less manufacturing activities means less (high-paying) jobs in this sector.

“With factory doors continuing to close across my state, Ohio workers and small businesses can’t afford to wait any more,” said Brown.

He acknowledged that China has been taking tentative steps in appreciating the yuan, but he thinks the pace isn’t fast enough and the bill would “level the playing field for American manufacturers and speed up our economic recovery.”

A similar bill was introduced in 2010 and passed in the House of Representatives. However, it failed to garner enough support in the Senate. Now, Brown thinks the Senate has enough votes to pass the bill, reported iMarketNews.

Here is the full-text of the proposed measure from Senator Snowe's official website:

U.S. Senators Olympia J. Snowe (R-Maine) and Sherrod Brown (D-Ohio) today announced the introduction of the Currency Reform for Fair Trade Act of 2011, legislation that will give the government additional tools to address China’s currency manipulation.

Senator Snowe said, “One significant contributing factor to the withering of our country’s once-unparalleled manufacturing base is the fact that China’s government deliberately suppresses the renminbi’s value, making Chinese imports artificially cheaper when competing against U.S. products. I am pleased to introduce the Currency Reform for Fair Trade Act to ensure the government is equipped to respond to this manipulation on behalf of our nation’s workers by imposing countervailing duties on subsidized exports from countries that continue to undervalue their currency at the expense of competing American businesses. I look forward to working with my colleagues to enact these vital provisions into law to prevent our trading partners from further undercutting true market competition and undermining American innovation.”

“China’s unfair currency manipulation has gone on for far too long. With factory doors continuing to close across my state, Ohio workers and small businesses can’t afford to wait any more,” Brown said. “The Chinese government has taken small steps to allow the yuan to appreciate, but it is not enough. Congress must take action immediately to address Chinese currency manipulation and pass legislation that will empower our government to combat this illegal trade subsidy. By combating currency manipulation, we can help level the playing field for American manufacturers and speed up our economic recovery.”

The legislation introduced today is similar to the 111th Congress bill H.R. 2378, the Currency Reform for Fair Trade Act of 2010, which passed the House of Representatives last September by a vote of 348-79. The legislation, which directs the U.S. Department of Commerce to treat currency undervaluation as a prohibited export subsidy, would ensure the government is equipped to respond on behalf of American workers and manufacturers by imposing countervailing duties on subsidized exports from countries like China.

Senators Snowe and Brown have been leaders in Senate efforts to address Chinese currency manipulation. Last month, in advance of President Hu Jintao’s visit, Snowe and Brown also filed Chinese currency legislation as an amendment to the tax extenders legislation. Previously, Snowe and Brown had sent a letter to Senate Majority Leader Harry Reid and Senate Minority Leader Mitch McConnell urging action before the Senate adjourned for the year on the Currency Reform for Fair Trade Act.